DiscussWorldIssues - Socio-Economic Religion and Political Uncensored Debate - View Single Post - Australians Migrating to America in Record Numbers

**N9NACzws** · 05-20-2010, 08:48 AM

On the contrary, RBA Lucy was hinting on a pause to interest rate rises.

As for tax deductables, if you read carefully what she wrote, she has a valid point too.

Many developed countries, including the US have stopped fighting inflation. Now, inflation rate of 4% is acceptable and cash rate of .25% is inevitable.

You can write a paper to convince the world that low tax and low interest rates is the way to go, but as far as I understand, Alan Greenspan had practice this since 2001 and looked what a mess he created.

There has to be a balance somewhere, unfortunately, humans are irrational.
The microcosm of this can be seen in Madoff's investors and current Aussie homebuyers as well as people buying USD (despite US having a greater debt problem than fall guy Greece).

So far, low cash rate is a good weapon for USA to deal with a China, and it exposed how fragile the Chinese economy is, and also how immature the Chinese stockmarkets (gambling dens) are.

RBA Lucy might be talking up an agenda - when is the next election? We see a very low unemployment rate right now so expect some wage inflation coupled with housing prices to make any pause a very brief one. Two factors are helping, China and Europe 2010. But we see rates going up a 7th time some time later this year - unless Consumers stop spending and the job market flattens - which might very well happen in 2010

I am not necessarily for low taxes but I do like certain consumption taxes or other more efficient means of funding government. I abhorr income taxes. Inflation is only a worry in China and Australia at this time - but for your sake 4% would mean much higher interest rates. Your target band should be approx 2-2.5% per year.

What most people dont seem to understand is its not just the US that is broke. Japan is more broke than the US as is the UK. A case in point is 2008-2010 quantitative easing. Greece is a symptom of the problem, with its bailout of 100% of its GDP it will never be able tor repay its debt. We are now looking very closely at Spain, Portugal, France, Italy, and Ireland. Virtually all of Europe is insolvent - except some of the Scandinavian countries.

The world economy is teetering once again. We need another Bill Clinton in the White House to raise taxes, pay China back, and for the American consumer to once again save the world. Obama does not look like the fiscal superman we were hopiing for. And looking at how ridiculous bipartisan politics in the US are - BOTH SIDES want to lower taxes - when 50% of all Americans are paying 0 tax! Can the US raise revenues and become fiscally balanced? Yes it can, but we can all thank the Bush years for spoiling Americans with free spending, loose credit, and low taxes. Politically its suicide to impose the corrective measures but it CAN be done in the US. Its not too late for the US. In Europe, its just too late. Thier taxes are already too high and how much can Germany do?

We thank China for the past year but it looks like a house of cards about to topple............................

05-20-2010, 08:48 AM	#33
N9NACzws Join Date Oct 2005 Posts 494 Senior Member	On the contrary, RBA Lucy was hinting on a pause to interest rate rises. As for tax deductables, if you read carefully what she wrote, she has a valid point too. Many developed countries, including the US have stopped fighting inflation. Now, inflation rate of 4% is acceptable and cash rate of .25% is inevitable. You can write a paper to convince the world that low tax and low interest rates is the way to go, but as far as I understand, Alan Greenspan had practice this since 2001 and looked what a mess he created. There has to be a balance somewhere, unfortunately, humans are irrational. The microcosm of this can be seen in Madoff's investors and current Aussie homebuyers as well as people buying USD (despite US having a greater debt problem than fall guy Greece). So far, low cash rate is a good weapon for USA to deal with a China, and it exposed how fragile the Chinese economy is, and also how immature the Chinese stockmarkets (gambling dens) are. RBA Lucy might be talking up an agenda - when is the next election? We see a very low unemployment rate right now so expect some wage inflation coupled with housing prices to make any pause a very brief one. Two factors are helping, China and Europe 2010. But we see rates going up a 7th time some time later this year - unless Consumers stop spending and the job market flattens - which might very well happen in 2010 I am not necessarily for low taxes but I do like certain consumption taxes or other more efficient means of funding government. I abhorr income taxes. Inflation is only a worry in China and Australia at this time - but for your sake 4% would mean much higher interest rates. Your target band should be approx 2-2.5% per year. What most people dont seem to understand is its not just the US that is broke. Japan is more broke than the US as is the UK. A case in point is 2008-2010 quantitative easing. Greece is a symptom of the problem, with its bailout of 100% of its GDP it will never be able tor repay its debt. We are now looking very closely at Spain, Portugal, France, Italy, and Ireland. Virtually all of Europe is insolvent - except some of the Scandinavian countries. The world economy is teetering once again. We need another Bill Clinton in the White House to raise taxes, pay China back, and for the American consumer to once again save the world. Obama does not look like the fiscal superman we were hopiing for. And looking at how ridiculous bipartisan politics in the US are - BOTH SIDES want to lower taxes - when 50% of all Americans are paying 0 tax! Can the US raise revenues and become fiscally balanced? Yes it can, but we can all thank the Bush years for spoiling Americans with free spending, loose credit, and low taxes. Politically its suicide to impose the corrective measures but it CAN be done in the US. Its not too late for the US. In Europe, its just too late. Thier taxes are already too high and how much can Germany do? We thank China for the past year but it looks like a house of cards about to topple............................
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